Author: johnredwood

Remain wrongly forecast a hit to U.K. exports of goods and services when we left the EU. They said the hit would be up to a 15% decline, which would mean a 4% loss of GDP.  They still use this in their commentaries on Brexit and it was baked into OBR forecasts. Whilst saying this could take 15 years to complete, they thought the bulk of the loss would happen quite soon after Brexit.

So what happened? U.K. goods trade continued to grow with the EU after we left, and grew faster with the rest of the world as it had been doing when we were a member. Services trade boomed in the years after we left. Time for apologies and red faces?

Apparently not so. Most keep reporting a bad forecast as a fact. Maybe they haven’t checked the data. One study earlier this year sought to dig Remainers out of their gloomy hole by arguing that whilst trade had gone up and not down it should have gone up more so we should still not a theoretical loss against these recently inflated expectations!

All this becomes relevant as President Trump threatens the rest of the world with tariffs designed to cut exports into the USA. The USA is the UK’s biggest trade partner by far, and we have a good growing trade with a U.K. surplus. It is good news we are out of the EU and can do our own trade deal with the US. The government should be proposing a trade deal to Mt Trump and should be using its Brexit freedoms to avoid the likely tariff war the EU seems to be planning. We should start by announcing we will not copy the EU carbon based tariffs they are bringing in against the US and others.

Facts4eu have published some excellent tables and graphs setting out the U.K. trade success post Brexit.

COP 29 meets against the background of a new US President about to take office who sees net zero as a scam. China generating 33% of world CO 2 is still expanding her output by burning more coal and gas as well as cornering the market in renewables and batteries. Now the US accounting for 13% of world CO 2 says Drill baby drill there is no way the world can meet its 2030 targets en route for net zero by 2050.

The Republicans by a majority reject not just the damaging policies of trying to force people into battery cars and heat pumps but also some of the theory and forecasts behind the policies. Some Republicans point out that there was substantial climate change before man arrived on the scene, with periods both colder and warmer than today. This argues that natural causes can boost and reduce temperatures substantially with no man made CO 2. Some argue climate models are dominated by man made CO 2 and need to include  many natural changes to get their predictions right. Some think there has always been extreme weather events and are not convinced there are now more or worse. Some think if China, Russia, India and others are not reining in their use of fossil fuels, why should America?

COP 29 is going to find it difficult to get advanced countries to pledge the huge sums needed by the emerging world to pay  for their huge transition. With the US under Trump likely to resist such payments it throws matters back on the Europeans. It is telling that the President of the EU and the President of France are giving this COP a miss and the German government has just collapsed. None  of these countries have the large sums the emerging world wants.They are asking for $1trillion a year for net zero transition!

President Trump will change this debate and force a re think to policies trying to cut CO 2 which are very costly. So far these policies have not succeeded in reducing world CO 2. With China and the US not trying this transition is much delayed.

The Western powers want to broker a peace in the Middle East. They want to prolong the war in Ukraine. Why this difference?

The policy towards Ukraine is based on condemning Putin for his aggression. It does  not offer Ukraine enough military support to allow them to win the war, preferring to drag it out through withholding important weapons and understandably refusing to commit NATO forces.

President elect Trump has indicated a wish to bring about a negotiated peace. European governments are against this, claiming it means helping Russia. They do not complain about a negotiated peace in the Middle  East which  on the same logic would be helping Hamas, Hezbollah and Iran.Meanwhile France provides very little financial or military help to Ukraine and Germany always offers les than Ukraine wants with delays in providing more effective weapons.

I remain against the idea of a NATO/Russia war so do think the U.K. should work with President Trump on what a peace agreement would look like. Central to it should be to give to all Ukrainians who want to live beyond Russian control a place to do so with better security guarantees. It seems unlikely that Crimea can be brought back into Ukraine.Of course the West should do all it can at any talks to support the Ukrainians seeking to restore peaceful authority over their lands and  who wish to live in a country independent of Russia. The EU needs to rethink its position to be more helpful to peace. Whilst the West sees this as a war against Russian invasion, Russia sees it as a war against EU expansion. .

The Bank of England has cut their base rate twice now. They have put their inflation forecast up after the budget and said this means fewer rate cuts and slower rate cutting from here. The budget was especially inflationary, pushing up public sector pay a lot with no productivity agreements and confirming higher managed energy prices. The whole disastrous energy policy means dearer energy going forwards.
The budget also pushed up longer term interest rates with knock on to mortgage rates. The ten year government bond borrowing rate surged to over 4,5%, a higher level than after the short lived Kwarteng budget when the Bank was hiking rates and announcing huge  bond sales. These market moves reflected justified concern about all the extra borrowing the government proposes after its rule change.

The bad budget according to Bank forecasts as well OBR forecasts will raise inflation and slow growth. Whilst both bodies are often wrong, on this occasion I agree with them that the budget measures are likely to slow growth from 2026 and push up prices sooner. These forecasters had to up 2024 growth forecasts because earlier this year they clearly under estimated and had to revise up recently because we enjoyed good growth in the first half.
The U.K. has a very bad public sector productivity problem and is wasting far too much money in the  public sector. The government should urgently cancel £19 bn of carbon capture spend, abandon ideas of an expensive HS  2 extension, control Bank of England losses and set out a productivity plan for public services.

Why do the left always want to personalise disagreements about what government should do? Why do they think they have a right to abuse anyone who disagrees with them? Why do they wish to be rude to powerful foreigners who may be popular in their own country? Why do they think they should involve themselves in foreign elections to save overseas voters from themselves?

In my years as an MP many leaders were elected to European countries that I thought were doing grave damage, including ones who were harming the U.K. I never said bad things about them as individuals and I never went to interfere in their elections. When President Biden was elected I was criticised on this site for congratulating him and stressing the need for the U.K. to find ways of working with him.

President Biden followed some very damaging policies. He pulled out of Afghanistan without consulting and supporting our troops left there. His unilateral action gave Afghanistan needlessly to the Taliban. He undermined all the work to keep them out, writing off the blood and treasure shed. He tried to cosy up to a dangerous Iran, letting them make more money from oil to build its big arsenal of fast missiles to target on Israel. He contributed to Putin’s decision to invade Ukraine and then led a western response which prolonged the war, giving Ukraine enough to extend hostilities but not enough to win. He sided with the EU and Ireland against us over the NI Protocol.

All these reasons persuaded me he was a poor President.It still didn’t make me put out nasty things about him, or believe that slanging him off would get him to improve.

Let me repeat the guidelines.

Please keep contributions short unless you have some well researched case to make. Do not send links to other people’s work, though links to official free sources are fine.Do not attack named individuals or institutions in a way that could be a libel. Do not use over the top language or swear words.

2 people who daily want to contribute will not be published. One wishes to make allegations about the influence of a couple of billionaires, refusing to see that the views they back are the consensus views of global institutions and governments which are much debated here. One uses over the top language to slang off named people and institutions. If you want free publication play by the rules.

Elon Musk is touted as a new Wastefinder General to go into the US government and cut back waste and excessive bureaucracy. He will doubtless find plenty of targets,  but will he be able to get control and force through change? Much of the excess takes the form of public bodies, regulators and overlapping Federal, state and local administration. They will be well protected by laws , lobbies and sometimes by Congress.

The U.K. has seen a similar rapid  expansion of external bodies and regulators. The first aim should be to stop the increase. It is a bad idea to set up a Football Regulator. Ministers and officials should not be judging the solvency and spending of football clubs. The Sport itself can establish rules for the major tournaments and leagues, with the clubs having a say and deciding which ones to join.

The second aim should be to raise the general productivity level. A recruitment freeze would allow say 6% a year reduction in headcount without redundancies, and give more scope for promotion to those with jobs as vacancies became available.

The third aim should be to reduce the amount of regulation being undertaken. The new government says there is too much planning, so bring on the simplifications. The delays for bat surveys and carbon checks could be pared back. Planning applications are far too long with too many associated consultant reports.

Whole  areas of government led activity like emissions trading should be ended. It’s needless extra  cost which boosts world CO 2 by forcing energy using industry out of the U.K., shifting to import dependence.

I have often argued that cheaper energy available in plentiful supply is crucial to any industrial strategy. Much of industry needs large quantities of energy to heat, cool, transform materials and power machine tools. Petrochemicals needs fossil fuels as feedstock. Many manufactures contain fractions of oil transformed into materials.

President Trump oversaw a major expansion of domestic oil and gas production in his  first term. This helped keep prices of energy, especially gas, lower in the US. It gave US industry a huge competitive boost compared to the U.K. and EU.

When Putin invaded Ukraine the EU was desperate to replace Russian gas and oil with imports from elsewhere. The Trump increased output saved them as the US made available more exports to them.

The U.K. has substantial potential resources both on and offshore but this government is determined to keep them in the ground. It means we import instead. All that tax revenue and  well paid jobs go abroad.World CO 2 goes up. It is a deeply damaging economic policy and a stupid environmental one. Will President Trump persuade  the U.K. government to copy his America First example?

The two lead issues of the economy and illegal migration were issues where President Trump and the Republicans were on the more popular side of the argument. I have not commented on their election during its progress but am not surprised by the likely results.

The mistakes of western governments over Covid lockdown reinforced by the big errors of the Fed, the Bank of England and the European Central Bank over inflation, money and interest rates were bound to lead to bad election results for them. We have seen the governments of France, Italy and the U.K. fall, to be followed by the US and probably  Germany next year. Electors hold governments responsible for inflation as they cannot throw Central Bankers out when they get it hopelessly wrong.

The surge in civil service numbers since 2016, up by a third has been coupled with plenty of grade creep. We have a much larger more top heavy civil service.

One of the reasons is departments always want new  people and new resource for any new policy or Ministerial initiative.There is  a reluctance to wind up old initiatives and transfer all the staff to the new. Another reason is people are kept in any given post for too short a time. They are regularly transferred and promoted, with their old roles being filled by  someone else caught in the  eternal reshuffling.

It means at any given time there are numerous people recently arrived in a new area needing to spend time trying to get up to speed, and others getting ready to move with diminishing interest in what they are still meant to be doing. There is a strong reliance on collective working entailing several personnel and layers of management being involved in framing advice to Ministers or making administrative decisions.

The danger of this system is no one ever feels responsible or can be blamed for an outcome. It means people with too little experience or  knowledge of the issues is involved in the work. It makes officials dependent on others often outside the civil service to be informed. It encourages duplication by hiring external consultants to do much of the task that an experienced official could do without outside help.